The cost of Russia's reaction to Turkey

Wednesday, November 25, 2015 - 01:47

Turkey's holiday industry is bracing itself after several major Russian tour operators suspended sales of trips to the country. It came after Turkey shot down a Russian fighter jet, and as Ivor Bennett reports, Russians make up a high percentage of Turkey's tourist numbers.

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The easy charm of Istanbul is an obvious draw for many.
Around 40 million people visit Turkey every year - over a tenth coming from Russia.
But that could be about to change.
Foreign Minister Sergei Lavrov.
(SOUNDBITE) (Russian) RUSSIAN FOREIGN MINISTER, SERGEI LAVROV, SAYING:
"A critical mass of terrorist outpouring on Turkish territory is accumulating. And in relation to this of course we do not recommend our citizens to travel to the Republic of Turkey."
Many, it seems, don't need the encouragement.
Protestors gathering outside the Turkish embassy in Moscow after the downing of a Russian jet by Turkey.
(SOUNDBITE) (Russian) MOSCOW RESIDENT, NUR ALI, SAYING:
"I think we need to react in the Russian way and bang the table."
(SOUNDBITE) (Russian) MOSCOW RESIDENT, TATIANA, SAYING:
"Not everything is clear but even so, I think there should be a retaliation."
Economically, there almost certainly will be.
Russian tourists contribute an estimated 4 billion dollars to the Turkish economy every year.
But several Russian tour operators have now suspended sales of trips there.
Tour company director Oksana Bulakh.
(SOUNDBITE) (Russian) COMMERCIAL DIRECTOR, TOUR COMPANY 'ALEAN', OKSANA BULAKH, SAYING:
"Turkey will definitely lose out very badly because Russian tourists make up a big part of the Turkish resort market. So of course, with the undersupply of them, I think there will be billions in losses."
Turkey is the second country on Moscow's travel blacklist after a Russian passenger jet was blown up over Egypt last month.
IG's Chris Beauchamp thinks it'll be a tough year ahead for the industry.
SOUNDBITE (English) CHRIS BEAUCHAMP, SENIOR MARKET ANALYST, IG, SAYING:
"A lot of these key business areas for them - Turkey, North Africa, Egypt - they seem to be sort of ticking them off the list really of places where you will see business being hit."
Off-season could help limit the immediate fallout.
But for other sectors - like construction and drinks - there is no such protection.
Shares in a number of Turkish firms active in Russia falling for a second day.

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